Are You Taking Your Profit First?
Why is it important to focus on PROFIT? Because as humans, we are programmed to place significance on what we see first. It’s called the Primacy Effect. Traditional accounting has taught us that Sales – Expenses = Profit. That’s fine and dandy for financial statements but not for business owners who live in the real world.
Brandi’s Profit First Success Story
Brandi came to us in November of 2020 for accounting and tax services for her retail business. Brandi was experiencing rapid growth and was having trouble calculating the amount she should spend every month on inventory. Her rapid growth came with some confusion. Brandi’s sales were growing, and she had a decent profit margin but couldn’t understand where her cash was going. She also wanted to open a new location but wasn't sure if she could afford it.
Why Profit First and What It Means To My Business
As a CPA I have witnessed many clients making boneheaded, expensive mistakes. In fact, I can only count on one hand the number of business clients that have made profitability their goal. Most clients I’ve had in the past were so focused on not paying taxes they let profitability fly out the window. They were shortsighted and misguided. My hope in writing this series of blogs is that I can help you avoid or stop making the same boneheaded (and sometimes costly) blunders that I made and encourage you to implement Profit First in your business. Put simply, Profit First is a cash flow system based on the national best-selling book Profit First by Mike Michalowicz. Note, I didn’t say accounting system. Profit First is most definitely not an accounting system. But more about that in future blogs.
Infrastructure & Equipment Purchases That Grow Farm Profits
You think it’s time to scale your flower or specialty farming operation. You’ve been growing flowers in the field for two, three or even more years now. You have increased production every year and your sales outlets are really starting to come together. You need to expand production on your farm and become more efficient. It’s time to add some infrastructure and large equipment to your flower farming enterprise. But these are big expenditures, right? You need to spend your money wisely and get the best bang for your buck. This blog will discuss some investments in your property and equipment that will boost efficiency, increase production, and grow revenue for your farm.
How Do I Prepare For A Recession?
Small businesses can be vulnerable to economic recession and disaster. If there is anything the Covid pandemic taught us, it’s that business owners need to be prepared to mitigate financial hardships. Sadly, we are now in a period of record-breaking inflation and the likelihood of recession is on the horizon according to some US economist. While you can’t control whether a recession will occur or not, there are some things you can do to increase the chance of your business surviving and possibly thriving.